Blue Coat Systems, Inc. (Nasdaq: BCSI), the Web appliance company "working to make the Web safe for business", posted stellar earnings today beating the Street's estimates by $.06 and raised guidance for it's third quarter.

BloggingStock's Georges Yared had a good write-up in August on the company's wide-area-network (WAN) optimization product. Yared has had a good call on this one and indeed, it's the company that keeps on giving with continued stock growth (it's up 200% so far for 2007). Yared has named Blue Coat to his list of "Top 25 Stocks for the Next 25 Years".

In a research piece issued last week, ThinkEquity analysts said that recent checks with US-based retailers suggest sustained growth in Blue Coat's WAN optimization and Web-security appliance in the US and increased sales momentum overseas. "We believe the WAN optimization growth secular trend continues to be strong and Blue Coat's differentiated unified offering continues to drive demand for Blue Coat in the U.S. and increase momentum overseas," said Jonathan Ruykhaver, a ThinkEquity analyst.

Boy, were they right. Net revenue for the second fiscal quarter of 2008 was $73.4 million, an increase of 85% compared to net revenue of $39.7 million for the same quarter last year and an 18% increase compared to net revenue of $62.4 million in the prior quarter.

Things are certainly humming for Blue Coat.

Zack Miller is the Managing Editor of IsraelNewsletter.com and a former equity analyst for a leading multinational hedge fund. Author holds no positions in the stocks mentioned above.

MOST NOTEWORTHY: Boston Scientific (BSX), Medtronic (MDT), St. Jude Medical (STJ), Bankrate (RATE) and AXA (AXA) were today's noteworthy initiations:

• Thomas Wiesel initiated coverage of the Medical Devices Industry:
• Boston Scientific (NYSE: BSX) was initiated with an Underweight rating, expecting shares to Underperform peers due to reductions in estimates, risks to the stent business and valuation.
  
• Medtronic (NYSE: MDT) was initiated with an Overweight rating, saying attractively valued as they believe the growth in underlying markets may be more robust than the current sentiment suggests.
  
• St. Jude Medical (NYSE: SJT) was initiated with an Overweight rating, saying shares offer exposure to attractive drivers, a management team with the best track record in the segment, and a potential acquisition candidate.
  

• Stephens believes the recent weakness in Bankrate (NASDAQ: RATE) due to "turmoil" in the market has created an attractive entry point, starting shares with an Overweight rating.

• Morgan Stanley assumed coverage of AXA (NYSE: AXA) with an Overweight rating, citing an attractive risk/reward and strong free cash flow...

OTHER INITIATIONS:

• S1 Corp (NASDAQ: SONE) was initiated with a Market Perform rating at Avondale.

• Needham started Blue Coat Systems (NASDAQ: BCSI) with a Buy rating.

• Credit Suisse initiated AK Steel (NYSE: AKS) with a Neutral rating.

• Jefferies started Molex (NASDAQ: MOLX) with a Hold rating.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

MOST NOTEWORTHY: Spectra Energy (SEP), ComScore (SCOR) and Data Domain (DDUP) were today's noteworthy initiations:

• Spectra Energy (NYSE: SEP) was initiated with a Buy rating and $32.50 target at Citigroup, with an Overweight rating and $32 target at Lehman Brothers and with an Overweight rating at Wachovia. Citigroup believes SEP provides investors above-average distribution growth driven by stable cash flows with little or no direct exposure to commodity prices. Wachovia is positive on SEP given its multi-year growth profile and high quality assets.

• ComScore (NASDAQ: SCOR) was initiated with an Outperform rating and $28 target at FBRC on valuation. The company was also initiated at Jefferies with a Hold rating and $25 target, citing valuation, although the firm believes the company is well positioned to benefit from the market demand for Web traffic data/analytics. Deutsche Bank initiated shares of ComScore with a Buy rating and $28 target.

• Data Domain (NASDAQ: DDUP) was started at Pacific Crest with an Outperform rating and $30 target and the firm expects growth to exceed 50% annually for at least the next two years.

OTHER INITIATIONS:

• ThinkEquity started shares of Altair Nanotechnologies (NASDAQ: ALTI) with a Buy rating and $6 target.

• ThinkEquity transferred coverage of Blue Coat Systems (NASDAQ: BCSI) with a Buy rating and raised its target to $63 from $51.

• Stifel started shares of ICT Group (NASDAQ: ICTG) with a Buy rating and $20 target.

• B. Riley started shares of Charles & Colvard (NASDAQ: CTHR) with a Buy rating and $8 target.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

MOST NOTEWORTHY: Polo Ralph Lauren (RL), Alcan (AL), Alcoa (AA) and Conn's, Inc (CONN) were today's noteworthy initiations:

• Polo Ralph Lauren (NYSE: RL) was initiated with a Market Perform rating at Piper Jaffray. The firm feels the risk/reward is balanced at current levels given the near-term risks from increased investment and exposure to inconsistent U.S. wholesale markets.

• Goldman Sachs resumed coverage of Alcan (NYSE: AL) and Alcoa (NYSE: AA) with Neutral ratings and a $101 target and $48 target, respectively.

• Morgan Joseph is positive on Conn's Inc's (NASDAQ: CONN) strong track record of growth, new store growth and easy comps, and initiated shares with a Buy rating and $34 target.

OTHER INITIATIONS:

• Merriman initiated shares of Blue Coat Systems (NASDAQ: BCSI) with a Buy rating.

• Stifel initiated shares of Pharmerica (NASDAQ: PMC) with a Hold rating on valuation.

• Equinix (NASDAQ: EQIX) and SAVVIS, Inc (NASDAQ: SVVS) were initiated at CIBC World Markets with Sector Performer ratings.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).